Porter's 5 Forces Model and Application (PDF)

To evaluate the marketplace or industry in which the suppliers are operating, we recommend using Michael Porter's, Five Forces Model. This model is a business framework used for analyzing the industry structure and supply market complexity. Five Forces analysis examines the competitive forces of five factors – barriers to new entrants, industry rivalry, substitutes, bargaining power of suppliers and the bargaining power of the buyers, in a given industry.

The strength of the industry rivalry, or the competitive battle amongst suppliers, can be a very powerful force in an industry as suppliers compete across various dimensions in order to gain market. Industry rivalry can be strong as the number of competitors increases, and as they become more equal in size and capability.